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Transactions concerning deposit and current accounts EU VAT case law

11 cases of the Court of Justice and the General Court of the European Union on this point of VAT law, from 2010 to 2025.

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Under each case, what the Court decided, from its summary. The summaries are AI-generated and are not official documents: open the case for the Court’s own text.

C-232/24 Kosmiro

Judgment · 23 October 2025 · Finland

VAT treatment of factoring fees and commissions

Both products are supplies of services for consideration and both fall within "debt collection" in Article 135(1)(d). The commission and arrangement fees are consideration for a single, indivisible taxable debt collection service. There is no separate exempt credit supply, since in trade factoring the funds are the price of the debts and in invoice factoring the financing is merely the corollary of collection. Article 135(1)(d)'s debt collection exception is unconditional and precise, so it has direct effect against the State. Factors and their advisers can no longer split factoring fees between taxable collection and exempt financing where the factor also runs the recovery.

C-427/23 Határ Diszkont

Judgment · 1 August 2025

A refund handling fee is its own supply, and it is not a net amount

The Court held that the handling service is a distinct and independent supply and not part of a single supply with the goods, and that it is not covered by the exemptions relied on. The protection of legitimate expectations may be relied on against the tax authority where that authority had consistently treated such services as exempt and had not informed the taxable person of the change in the national legislation which, in its earlier version, expressly listed them among exempt activities. It is irrelevant in that context that the taxable person later received a non-binding reply, given after the event on a request for a ruling, stating that the services were ancillary costs sharing the treatment of the exempt principal transaction. Articles 73 and 78 preclude the practice of treating the amounts invoiced as the handling fee as net amounts not including VAT, where the supplier treated its supply as exempt and it is manifestly impossible for it to recover the VAT afterwards from the purchasers. The judgment separates two operations that a retailer performs in the same transaction with the same customer and gives them different treatment, and it does so without allowing the exemption on the goods to carry across to the service.

C-801/19 Franck

Judgment · 17 December 2020 · Croatia

Exempt credit granted by a non-financial trader through bills of exchange

The Court held the exemptions in Article 135(1)(b) and (d) apply. Making funds obtained from a factoring company available to another taxable person for remuneration, following transfer of a bill of exchange issued by that person and with a guarantee of repayment at maturity, is exempt. The provision of funds is the principal supply. The rest is ancillary. Non-financial status, the contractual labels and repayment to the factor rather than the lender are irrelevant, subject to national court verification. Confirms that industrial and retail groups providing intra-group or third party finance can rely on the credit exemption, and that the 135(1)(b) and (d) exemptions do not depend on regulated status or on funds being repaid to the provider.

C-42/18 Cardpoint

Judgment · 3 October 2019 · Germany

VAT treatment of cash point operation services

The services supplied to the bank are not exempt under Article 135(1)(d). The functional test is whether the service causes the actual or potential transfer of ownership of the funds, or performs the specific, essential functions of such a transfer. The supplier neither authorised the withdrawals nor debited any account, and dispensing the notes transferred no title from it. The issuing bank did that. Being essential to an exempt payment transaction is not enough, and the consideration was readily identifiable. Outsourced ATM operation, cash replenishment, hardware and software provision and transaction reporting are taxable, and the physical handling of cash does not distinguish such services from the technical and administrative assistance denied exemption in Bookit.

C-5/17 DPAS

Judgment · 25 July 2018 · United Kingdom

Direct debit administration is not an exempt payment transaction

The exemption does not apply. Only services which themselves effect the legal and financial changes characteristic of a transfer of money qualify. Instructing banks to execute direct debits is administrative and merely a preparatory step, comparable to the card handling in Bookit. That the service is essential to the payments being made does not make it exempt. AXA UK, which addressed only debt collection, does not widen the concept. The debt collection question was left unanswered. Relevant to payment plan administrators, membership and subscription scheme operators, bureaux and outsourced billing providers who collect by direct debit and remit onward.

C-607/14 Bookit

Judgment · 26 May 2016 · United Kingdom

Card handling fees and the payments exemption

The exemption does not apply. The service is technical and administrative assistance. An exchange of information between a trader and its merchant acquirer to obtain payment. The provider neither debits nor credits accounts, nor instructs any debit, has no control over the authorisation code, and assumes no liability for the change in the legal and financial situation. Being essential to the payment is not enough. Whether the code comes directly or via the acquirer is irrelevant. The referring court must still decide whether the fee is a single supply with the ticket sale. Merchants and their agents charging separate card handling or booking fees, in ticketing, travel, events and online retail, cannot treat those fees as exempt payment handling merely because their file transmission triggers settlement.

C-130/15 National Exhibition Centre

Judgment · 26 May 2016 · United Kingdom

Card handling booking fees and the payments exemption

The exemption does not apply. The provider neither debits nor credits accounts, nor orders any debit or credit, nor assumes responsibility for the legal and financial changes. It merely applies technical and administrative means, exchanging information with its merchant acquirer to obtain payment. Indispensability to the payment, automation, and whether the authorisation code comes directly or via the acquirer are all irrelevant. The Court also questioned the referring court's premiss that the card handling is a separate supply rather than ancillary to the ticket sale, leaving that to the national court. Booking and card handling fees charged by merchants, ticket agents, venues and other retailers on card payments are taxable, and any historic repayment claims built on the SDC functional test fail where the trader does not itself effect the entries or bear responsibility for the transfer.

C-264/14 Hedqvist

Judgment · 22 October 2015 · Sweden

VAT treatment of bitcoin exchange transactions

The exchange transactions are supplies of services for consideration. Bitcoin is not tangible property, having no purpose other than to serve as a means of payment, and the margin is direct consideration. They are exempt under Article 135(1)(e), which is not confined to legal tender but extends to non-traditional currencies accepted by the parties as an alternative to legal tender with no purpose other than as a means of payment. Articles 135(1)(d) and (f) do not apply. Bitcoin is neither an instrument transferring money nor a security.

C-464/12 ATP PensionService

Judgment · 13 March 2014 · Denmark

Occupational pension funds as special investment funds

Such pension funds may be special investment funds where they are funded by the beneficiaries, the assets are invested on a risk-spreading basis and the pension customers bear the investment risk. That is the decisive distinction from Wheels. Employer payment, collective agreements, payout form, income tax deductibility and an ancillary insurance element are irrelevant. "Management" covers opening accounts and crediting contributions, plus Annex II accounting and account information services. Those same crediting services, and anything ancillary or forming a single supply with them, are also exempt payment or transfer transactions. For third party pension administrators and their fund clients the ruling unsettles the treatment of contribution processing where the scheme is defined contribution and the members carry the investment risk.

C-350/10 Nordea Pankki Suomi

Judgment · 28 July 2011 · Finland

Electronic messaging services for financial institutions and the finance exemptions

Those services do not fall within either exemption. The services are supplied for consideration and are taxable. They merely transmit information and do not themselves effect any transfer of funds or securities, so they produce none of the legal and financial changes characterising an exempt transaction. That an element is essential, or the only one available on a market, is not enough. The supplier's contractual responsibility, however large in money terms, covered only secure and legible transmission, so it was technical and not specific and essential. Confirms that outsourced infrastructure supporting payments and securities settlement is taxable unless the provider assumes responsibility for the specific, essential elements of the financial transaction.

C-175/09 Axa UK

Judgment · 28 October 2010 · United Kingdom

Payment collection services and the debt collection exclusion

The various acts formed a single indivisible supply whose economic purpose was to move the monthly sum from patient to dentist. In principle a transaction concerning payments, it nonetheless fell within the debt collection exclusion, which is construed broadly. The service was designed to obtain payment of debts and relieved creditors of work they would otherwise do. It was irrelevant that the debts were collected on their due date and that no coercive recovery measures were involved. Outsourced collection of recurring customer payments is taxable, whoever supplies it and whatever technology is used.

Related topics

Exemptions · Supply of services · Transactions concerning payments and transfers · Economic activity · Transactions in securities · Direct effect · Taxable transactions · Supply of goods or services · Supply of goods · Legitimate expectations